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Pigs can fly. Really. And not just in the metaphorical sense, as in the New York Mets' four-game sweep of the so-called Subway Series from the crosstown rival Yankees last week.

The Mets will no doubt return to form, which has the band of mostly not-ready-for-the-bigs no-names one step above the cellar in the National League East, even after their winning streak. And the injury-riddled Yankees -- who were aptly caricatured on the cover of the New Yorker as elderly veterans in walkers and wheelchairs -- were just a couple of games back of the AL East leaders, the archrival Boston Red Sox.

No, the real pigs that are flying, nay soaring, are those from
Smithfield Foods
(ticker: SFD), which agreed to be acquired by China's largest meat processor, Shuanghui International Holdings, for $7.1 billion, including the debt load that it will be assuming. And that was some fat price to bring all those piggies to the Chinese market -- $34 a share, a 31% premium to its close prior to the deal's announcement on Wednesday morning.

The obvious attraction for Shuanghui is that in China pigs are more prone to be found floating dead in rivers than taking flight. So the company may be able to expand the supply of safe meat to Chinese consumers, already the world's biggest pork eaters, who will likely further increase their appetite for meat as the growing middle class starts to live higher on the hog. And that aptly describes Smithfield executives, too, who stand to pocket more than $85 million in the buyout, according to Bloomberg.

The deal is unlikely to raise alarms of a bacon gap, analogous to worries over a missile gap with the former Soviet Union during the Cold War, although the deal will be reviewed by the government's Committee on Foreign Investment in the U.S. And while the Smithfield takeover is the biggest deal for a Chinese buyer of a U.S. company to date, it's unlikely to be the last.

With its currency, the yuan, at a record level against the dollar -- in large part because of prodding by the U.S. government -- China can buy U.S. assets relatively cheaply. Deals such as Cnooc's failed attempt to acquire Unocal for $18.5 billion in 2005 would still most likely be blocked because of security concerns. But the burgeoning ranks of Chinese millionaires and billionaires no doubt will want to join their peers from around the globe to snap up luxury overseas digs at comparative bargain prices (at least compared with Hong Kong or London) in the States.

That China might want to go on an American shopping spree might have something to do with the vast amounts of greenbacks it has accumulated, including $3.4 trillion in currency reserves at its central bank, the bulk of which is parked in U.S. Treasury and agency securities. Back in 2009, Chinese officials began to suggest an international alternative to the dollar as the world's main reserve currency and medium for international trade and finance, especially as the Federal Reserve was beginning to pump them out with abandon. Treasury Secretary Tim Geithner at the time said there was some merit to the idea theoretically, although there isn't any practical alternative to the dollar.

Still, even such a notion brought a howl of protest from Rep. Michelle Bachmann, the Minnesota Republican who went on to become a favorite of the Tea Party and briefly a front-runner for the 2012 GOP nominations (along with other worthies such as Herman "9-9-9" Cain and Texas Gov. Rick "Oops" Perry.) But long before that, in 2009, in one of the most uninformed of her many broadsides (a category tough to narrow down), Bachmann completely conflated the dollar's international reserve currency status and its standing as the U.S.'s legal tender. She accused Geithner of wanting to replace the greenbacks in our pockets with an international currency favored by the likes of China and Russia.

Bachmann announced last week that she wouldn't run for re-election in 2014, probably because she faced a tough race, even in a reliably Republican district. While Democrats will lose a bête noire, the GOP should be pleased even more since it will be more likely to hold onto the seat with a candidate possessing, shall we say, greater familiarity with the facts. But her departure won't stop pressure to keep the dollar down against the Chinese yuan and other currencies, which offers global investors the chance to buy up U.S. assets at (for them) bargain prices.

IF YOU SOLD IN MAY to go away, it should have been bonds, or stocks that act like bonds.

Amid strong bullish sentiment for risk assets and hints from Federal Reserve officials from Ben Bernanke on down that the central bank might mull tapering its $85 billion-a-month bond-buying spree at some point this year, yields shot up and crushed prices of fixed-income securities and their close cousins. That ineluctable feature of bond math may have been an expensive lesson for investors who have clambered into income securities and funds.

With the 10-year Treasury yield hitting a low of just over 1.60% right around May Day, and rising to a peak of about 2.20%, before edging back down to 2.13% by Friday's close at month-end, it wouldn't seem to be a big deal to neophytes. But it translated into a 2% price drop for the
iShares Core Total U.S. Bond Market AGG -0.30507534436535083%iShares Core U.S. Aggregate Bond ETFU.S.: NYSE Arca107.84
-0.33-0.30507534436535083%
/Date(1481335200004-0600)/
Volume (Delayed 15m)
:
3991853AFTER HOURS107.84
%
Volume (Delayed 15m)
:
539068
P/E Ratio
N/AMarket Cap
N/A
Dividend Yield
2.2690727002967357% Rev. per Employee
N/AMore quote details and news »AGGinYour ValueYour ChangeShort position
exchange-traded fund (AGG), which tracks the Barclays Aggregate Bond index, the benchmark for the bond market. In other words, a year's income was lost in a month.

Until Friday's wobble, the consensus -- as promulgated on bubblevision -- was a form of heads, stocks win, and tails, ditto. If the Fed tapers its bond purchasing, it must mean that the economy is, at long last, robust enough to cast off the crutches provided by super-easy money. And if the economy still needs that injection, Dr. Bernanke will be at the ready, with a syringe. Can't lose either way.

If anything, the evidence tilts to the latter. Mortgage rates followed Treasury yields faithfully, with the 30-year fixed-rate home loan jumping to a 12-month high of 3.81% last week, according to Freddie Mac. Borrowers responded almost instantly, with home-loan applications slumping 8.8%, a decline that included a 12.3% plunge in refinancing applications, their biggest fall in a year, notes David P. Goldman, head of the Macrostrategy advisory and former head of bond research at Bank of America.

The "hair-trigger sensitivity" to a blip in mortgage rates may reflect the heavy buying of existing single-family homes by institutional investors, which he notes was a "favorite trade last year." The rate of return from such investments depends crucially on the cost of financing, plus the prices paid for the dwellings, which have been rising, to the applause of bulls.

Meanwhile, Robert Kessler, the eponymous head of Kessler Investment Advisors in Denver and a longtime bull on Treasuries, admits that he was wrong-footed on the past month's backup in Treasuries. But he thinks that yields won't remain at current levels for long. The macroeconomic ingredients for the Fed to rein in stimulus aren't in place, notably a still-elevated unemployment rate at 7.5% and "core" inflation (excluding food and energy) around 1.1%.

Macrostrategy's Goldman maintains that the improvement in employment "is vastly exaggerated," as the rise in payrolls in April was offset by a drop in hours worked. Hiring more people to put in shorter hours suggests that employers were trying to avoid paying health-care benefits, he adds.

At the same time, reported corporate earnings per share -- which is what the stock market cares about -- are being flattered by the reduction in the denominator, with $345 billion of corporate buybacks reducing share counts at an 8% annual rate. "The absolute level of profits has fallen. And companies are reducing guidance for the second quarter," Goldman declares.

That leaves the Fed.

And given the central bank's focus on labor, the market-moving potential from this coming Friday's employment report for June is immense. Wall Street is guessing that nonfarm payrolls will post another increase of about 170,000 and that the headline jobless rate will remain at 7.5%. In its perverse way, the stock market may hope for fewer folks on the job, if that keeps Ben Bernanke from pulling away the punch bowl.